NEPRA Net Metering New Rules 2026

The NEPRA net metering new rules 2026 represent the most significant shake-up of Pakistan’s renewable energy sector in over a decade. On February 9, 2026, Pakistan’s power regulator (National Electric Power Regulatory Authority) formally notified the Prosumer Regulations 2026, completely abolishing the one-to-one net metering system that made residential solar installations economically viable for 466,000 Pakistani families and replacing it with a new “net billing” framework that fundamentally changes how solar generators are compensated.

This comprehensive guide explains exactly what changed, why the government made this controversial decision, how it affects both existing and new solar users, and what actions you must take if you have net metering installed. Whether you’re currently benefiting from net metering or considering installing solar in 2026, this article provides the complete analysis of NEPRA’s new rules and their real-world impact on your household finances. (link to your article on “how net metering works Pakistan“)

What Changed? NEPRA’s Dramatic Policy Reversal

February 9, 2026: The Day Everything Changed

On Monday, February 9, 2026, NEPRA notified the Prosumer Regulations 2026, immediately replacing the net metering framework that had governed solar installations since 2015. This wasn’t a gradual policy adjustment—it was a complete overhaul affecting 466,000 existing solar users nationwide and fundamentally altering the economics of future installations.

The Core Change: Old system (2015-2026): Solar users sent excess electricity to grid at same rate they paid for grid electricity (one-to-one exchange) New system (2026 onwards): Solar users sell excess electricity at Rs 11-15/unit (national average energy purchase price) but buy grid electricity at Rs 37-55/unit (standard consumer tariff)

Real-world impact example:

Old system: Generate 100 units, use 70 units, export 30 units at full credit = zero-negative bill
New system: Generate 100 units, use 70 units, export 30 units at Rs 11/unit = must pay difference on 70 units consumed

Complete Breakdown: NEPRA New Rules 2026 vs. Old Rules 2015

Policy Element	Old Rules 2015	New Rules 2026	Impact
Buyback Rate	Rs 25.9-26/unit	Rs 11-15/unit	50-60% rate cut
Unit Exchange	One-to-one (100 units export = 100 units credit)	Abolished (export at national price)	Massive income reduction
Contract Period	7 years	5 years	Loss of long-term security
Payment Timing	Monthly adjustment on bill	Quarterly payment	Cash flow impact
Capacity Limit	Up to 1MW allowed	Limited to sanctioned load	Smaller systems permitted
Installation Cost	DISCO covered interconnection	Prosumer pays all costs	Hidden expense increase
Concurrence Fee	Not applicable	Rs 1,000 per kW	Additional expense
Rate Review	Fixed for contract duration	NEPRA can revise quarterly	Rates may change during agreement

Critical Distinction: These changes apply to ALL users under the new system, though existing users received temporary protection (see below).

The Aftermath: PM Orders Review, Draft Amendment Issued

February 13, 2026: Government Intervention

Merely four days after NEPRA’s notification, massive public backlash from politicians, solar industry, and existing users forced Prime Minister Shehbaz Sharif to intervene. He ordered the Power Division to immediately request NEPRA review the decision protecting existing consumers.

February 16, 2026: Draft Amendment Published

NEPRA issued a draft amendment to Regulation 21 of the Prosumer Regulations 2026, proposing to:

✓ Protect existing consumers: Those with valid net metering agreements as of February 9, 2026, will continue under old rules until their contracts naturally expire

✓ Grandfather existing rates: Existing users keep Rs 26/unit buyback rate + one-to-one unit exchange until 2026-2029 (when 7-year contracts expire)

✓ New users follow new rules: All applications filed after February 9, 2026, must follow net billing system at Rs 11-15/unit

✓ 30-day public feedback: NEPRA soliciting stakeholder comments before final decision (expected late February/early March 2026)

Current Status (February 2026): Draft amendment in public consultation phase. Final decision expected by end of February 2026.

Existing vs. New Users: Critical Differences

If You Have Existing Net Metering (Installed Before February 9, 2026)

Current Status (With Draft Amendment Protection):

Continue under old 2015 net metering rules
Keep Rs 25.9-26/unit buyback rate
Maintain one-to-one unit exchange
7-year contract honored until natural expiration
After expiration (2026-2029): May renew at new rates OR cease solar generation

Important: This protection is not yet final—depends on NEPRA’s decision after 30-day consultation period (expected late February 2026).

If Installing New Solar in 2026 (After February 9)

You Will Follow Net Billing System:

Buyback rate: Rs 11-15/unit (national average energy purchase price)
No unit-for-unit exchange (abolished)
Contract duration: 5 years only (vs. 7 for old system)
All interconnection costs: Your responsibility (Rs 1,000/kW concurrence fee + meter installation + wiring)
Payment timing: Quarterly settlement (not monthly bill adjustment)
Rate revision: NEPRA can change rates during contract period

Financial Impact: A new 5kW solar system generating 150 units daily now earns only Rs 1,650-2,250 daily vs. Rs 3,900-3,900 under old system—a 55% reduction.

Why Did NEPRA Make This Change? Understanding the Government’s Argument

The government has consistently argued that net metering created unsustainable financial burden on Pakistan’s power sector and non-metering consumers.

NEPRA’s Official Justification

The Numbers:

466,000 existing net metering consumers receiving subsidized electricity
Total annual cost to power sector: Rs 270+ billion
Per non-metering consumer burden: Rs 3.5 per unit additional cost
Projected 10-year cumulative burden: Rs 4.6 trillion

The Argument: “It’s unfair that 466,000 wealthy solar-installing families receive free/negative electricity bills while 38.5 million regular grid consumers subsidize their systems through higher tariffs. Net metering essentially shifts cost from solar users to poor non-solar families.”

Government Position:

Existing consumers: Protected through contract honor (compromise solution)
New consumers: Must bear true economic cost of their generation (net billing at actual national average energy price)
Long-term objective: Transition all users to cost-reflective pricing by 2033 (when 7-year contracts expire)

Impact Analysis: How New Rules Affect Your Monthly Bills

Existing Net Metering User (Protected Until 2026-2029)

Scenario: 5kW system, 150 units daily generation, 100 units daily consumption

Old system (current, protected through contract):

Generated: 150 units daily (4,500/month)
Consumed: 100 units daily (3,000/month)
Net credit: 50 units daily (1,500/month)
Monthly bill: NEGATIVE (you get PKR 38,000-39,000 credit at Rs 26/unit)

After contract expiry (2026-2029), if shifted to net billing:

Generated: 150 units daily
Consumed: 100 units daily (at Rs 37-55/unit = PKR 111,000-165,000/month)
Net credit: 50 units daily (at Rs 11-15/unit = PKR 16,500-22,500/month)
Monthly bill: POSITIVE PKR 88,500-148,500 (vs. negative Rs 38,000 previously)

New Solar User (From February 9, 2026 Onwards)

Same scenario: 5kW system, 150 units daily, 100 units daily consumption

Net billing system (mandatory):

Consumed: 100 units @ Rs 37-55/unit = PKR 111,000-165,000/month
Generated export: 50 units @ Rs 11-15/unit = PKR 5,500-7,500 credit/month
Net monthly bill: PKR 103,500-159,500

Comparison to old system: 160% MORE EXPENSIVE per month

Technical Requirements: NEPRA’s New Infrastructure Rules

Beyond rate changes, NEPRA has introduced technical restrictions:

1. Bidirectional Metering (Mandatory)

All prosumers must install meters measuring electricity flow in both directions
Either single bidirectional meter OR two separate meters (must match in calculations)
Must comply with NEPRA-approved safety standards
Meter readings via handheld units (HHU) or automated systems

2. Capacity Limitations (New Restriction)

Major Change: System capacity limited to your sanctioned load (previously could exceed it)

Example:

Your home sanctioned load: 5kW
Old rules: Could install 10kW system, export 5kW daily
New rules: Maximum 5kW system allowed (cannot exceed sanctioned load)

Impact: Cannot oversize systems to maximize export potential anymore.

3. Transformer Capacity Restriction (New Rule)

No new connections allowed if distributed generation reaches 80% of transformer capacity
Systems 250kW+ require mandatory load flow study
Protects grid stability but limits rural installations

4. Application Processing Timeline (Standardized)

DISCO acknowledges application: 5 working days
Technical review: 15 days
Interconnection facilities installation: 15 days after payment
NEPRA concurrence: 7 working days
Total timeline: 42 days maximum

Financial Burden Shift: Why New Users Lose Money

The core issue is that new users bear the true cost of capacity payments previously subsidized by older users.

Understanding Capacity Payments

Pakistan’s electricity tariff includes two components:

Energy charges: Rs 11-15/unit (what they generate)
Capacity charges: Rs 25-40/kWh annually (infrastructure costs)

Old system: Solar users paid capacity charges despite generating their own electricity (hidden subsidy)

New system: Solar users still must pay capacity charges on grid electricity consumed (unsubsidized cost)

Result: New prosumers paying true economic cost while old prosumers benefit from grandfathered subsidized rates.

FAQ: NEPRA Net Metering New Rules 2026

Q1: Will my existing net metering be canceled immediately?

A: According to the draft amendment (not yet final), no. Existing users with valid contracts before February 9, 2026, will continue under old rules until contract expiration. However, this protection is temporary—when your 7-year contract expires (2026-2029), you’ll be forced to renew at new rates or cease solar generation. Final decision depends on NEPRA’s review of public feedback (expected late February 2026).

Q2: Should I apply for solar installation now or wait?

A: If you want the higher Rs 26/unit rate, you should have applied before February 9, 2026. If applying now (after February 9), you’ll get the lower Rs 11-15/unit rate regardless. However, waiting might be beneficial if NEPRA’s final decision changes rates again. Most experts recommend waiting for final amendment decision (late February) before committing to new installations.

Q3: How much money will I lose when my existing contract expires?

A: Approximately 55-60% of current solar income. Example: If your current solar installation saves PKR 5,000-8,000 monthly, after contract expiry you’ll save only PKR 2,000-3,200 monthly at new rates. Additionally, you’ll lose the one-to-one unit exchange benefit. Total monthly income reduction: 50-70%.

Q4: Can NEPRA change the rates during my 5-year contract?

A: Yes. The new regulations explicitly state NEPRA can revise the national average energy purchase price (NAPP) at any time, and those changes automatically apply to existing agreements. This provides no rate protection for new users (unlike old 7-year fixed contracts).

Q5: What is this Rs 1,000 per kW concurrence fee?

A: A non-refundable fee new prosumers must pay NEPRA for regulatory approval. Example: A 5kW system costs Rs 5,000 concurrence fee. It’s a hidden cost not included in many solar quotes and must be paid before interconnection. Plus, all meter installation, wiring, and interconnection costs are now prosumer responsibility (previously DISCO paid some costs).

Q6: If I already have net metering, should I increase my system capacity?

A: No. Additions to your system after February 9, 2026, would fall under new rules regardless of when original system was installed. Additionally, new capacity restrictions (limited to sanctioned load) prevent oversizing. Best strategy: Protect existing system, don’t expand.

Q7: What does “sanctioned load” mean and how does it affect me?

A: Sanctioned load is the maximum electrical capacity your home is approved to use by the DISCO (typically 3-5kW for residential). Under new rules, solar system capacity cannot exceed sanctioned load. Old users could exceed sanctioned load; new users cannot. This effectively caps new system sizes at 3-5kW for most homes.

Q8: Will existing users get any compensation for rate reduction after 2026-2029?

A: No compensation discussed by government. After your 7-year contract expires, you’ll either: (1) Renew at new Rs 11-15/unit rates, or (2) Remove the system entirely. No buyout or compensation for loss of net metering benefits. (Internal link suggestion: link to your article on “solar system payback period Pakistan”)

Q9: Is there any chance the government reverses this decision?

A: Unlikely. While PM ordered a review of existing consumer protection, the underlying policy to shift all users to net billing is government fiscal policy (reducing power sector burden). The draft amendment protects existing contracts, but the transition to net billing for all users is permanent long-term strategy. By 2033, virtually all users will be on net billing.

Q10: Should I remove my solar system before contract expires?

A: Only in extreme cases. Even at new rates, solar typically saves 20-40% on electricity bills. Removing a functioning system wastes the original investment. Better strategy: Accept lower post-contract savings, use system for household consumption priority, and don’t rely on export income.

Conclusion

The NEPRA net metering new rules 2026 represent a watershed moment for Pakistan’s solar sector. The shift from one-to-one net metering to net billing fundamentally changes the economics of residential solar, reducing new user income by 55-60% while protecting existing users until their contracts naturally expire.

The government’s fiscal argument is mathematically sound: 466,000 net metering consumers were indeed receiving subsidized electricity at cost to 38.5 million regular consumers. However, the transition impacts have been severe, causing legitimate investor concerns about policy stability and contract security.